BANXA — Making cryptocurrency accessible to people through fully compliant infrastructure

Cryptocurrency is the future payment solution, and the whole crypto industry is going through a transformative phase. While Governments and authorities are skeptical about this new technology, most of the institutions and the public have started realizing its true potential. To facilitate this further, BANXA is a Payment Service Provider that is making cryptocurrency easily accessible to people with fully compliant infrastructure. We interviewed Domenic Carosa, the Founder & Chairman of BANXA, to get a better overview of the crypto industry and the service offered by the company. Here are a few excerpts of the interview:

Let us know about the idea behind how and why BANXA was established.

BANXA was founded in 2014, originally after I experimented with mining bitcoin. We decided to start trying to help people buy cryptocurrencies easily. We saw the potential in digital assets, which allowed unbanked people or outside the traditional system to access financial opportunities. First, we launched consumer-facing websites, such as bitcoin.com.au, bitcoin.co.uk, and a host of others. We started to build the backend system that would later become BANXA. The bitcoin.com.au company grew significantly during 2017, but when the market went into contraction, we felt the pinch like many other cryptocurrency companies.

Early in 2018, we re-evaluated our technology stack and our IP that we had built over the previous years and saw the opportunity that would become BANXA. Cryptocurrency exchanges like Binance were growing and were very technology-focused. However, while we are a technology company, our real area of expertise was the marriage of our technology and our realization that the whole digital asset sector would grow more regulated over time. We went through a struggling process to open bank accounts when banks were very wary of crypto. We saw that our expertise was of value, and we could bring that value to digital asset businesses.

Q. The regulatory requirements in the crypto market keep on changing. How do you keep up with the latest laws in the countries you operate in?

Understanding the regulatory environment is a core piece of the BANXA IP. Due to our foundation servicing customers in Europe, Australia, Canada, and other markets, we were very familiar with the different regulatory environments. We had the great core of a compliance team. BANXA is very forward-thinking, but from a regulatory perspective, we are conservative. We understand that many jurisdictions and the regulators in those jurisdictions are still forming opinions on digital assets. To work well in the space, you need to be comfortable with uncertainty and be flexible. It is also critically important to be transparent and have integrity. As a company, BANXA has grown in various markets, we’ve actively pursued licensing and registrations and embraced regulation in each of those markets - it’s part of our value, with those licenses and registrations, we can access local payment methods, providing greater flexibility to partners and better rates to end-users.

Q. Tell us about your major global and local business partners.

Our partners are the crypto giants in the space - our early-stage investors included OK Group and Kucoin, some of the largest global exchanges. Later, we partnered with Huobi, another big player. In 2019/20, we partnered with Binance, Shapeshift, and a host of others. Currently, BANXA has about 70 partners, and we are adding more every month.

Our aim is to reach 150 partners by June 2022 and 300 by the following year. The payments business is one of scale - with the scale, we can provide the best rates to our customers and the best service to our partners.

Q. Explicate how BANXA provides simple integration with other businesses?

Our technology platform is world-class. It is critical for us as a business that our integration is very simple. We’ve spent a lot of time building our technology stack and scaling our development team to continue to add features and improvements. We are building the infrastructure layer of a new payments system. In the blockchain industry, there’s a saying that if you don’t have a development team, you’re just marketing. We believe that at BANXA, and our tech stack is evidence of that.

Q. In recent times, several governments have been taking actions against the free flow of crypto assets. How do you see this in the longer term and its effect on the company?

After every bull market, there is a shake-out. We saw this post the ICO boom in 2017, with the SEC looking at regulation and launching a few investigations. We are currently in another bull market, and this regulatory response is to be expected. Regulators work for the sole purpose of trying to protect investors. Most of the regulation is to safeguard non-professional investors from products that are not driven by market forces, the Great Depression, the Savings and Loan crisis, the recent GFC, financial regulation is always in response to a significant market movement. The crypto market is the same; this was to be expected.

In the short term, there may be some impact on our daily volume as the crypto market dips, while in the longer term, we don’t envisage any impact. Greater transparency and ‘fit for purpose’ regulation are a good thing for the market. We believe that strongly at BANXA. We are listed on the Toronto Stock Exchange because it requires us to report our audited accounts, ownership, our investors, and our strategy. We are the only company in our sector to do so.

Q. How do you implement Anti-Money Laundering or KYC requirements as a Payment Service Provider?

It is critical that governments and regulators are comfortable with the space and understand that there are mature actors in the market. One of the essential aspects is Anti-Money Laundering (AML), Counter-Terrorism Financing (CTF), and Know-Your-Customer (KYC). Complying with these regulations is the sustainable, growth-focused approach.

At BANXA, our technology uses machine learning and automated processes to verify our customers’ identities and comply with regulations. Country by country, regulations vary. Our technology platform integrates crypto transaction monitoring, identity databases, negative news searches, and various other data feed.

Q. Let us know if the company is planning to launch any new product or service.

We have a lot of plans in the works. We are adding new coins, new partners, and new product features monthly. This month we added ten coins and four partners, we are adding some new payment methods next month. We are looking to roll out the crypto “sell” feature country by country once we test the technology and comply with local payment regulations. We are also optimizing our system to get more than 99% of our payments processed in less than 20 minutes, and we are getting close.

Q. Any future expansion plans of the company?

We’ve recently expanded our Asian and European teams as we build out new payment options and channels, and one of our core aims is to continue our lead in local payment methods - BANXA has the most payment methods of any payment provider for the digital asset space. We also expect a period of consolidation in the crypto sector overall. If there’s a chance that we can find a company that helps us provide better service to our partners, we’d consider an acquisition.

About the Founder

Domenic Carosa is the Founder & Chairman of BANXA. He founded the company in 2014. Domenic is a tech pioneer, having founded or invested in over 50 private and public technology companies over the last 25 years. He holds a Masters of Entrepreneurship and Innovation (MEI) from Swinburne University, Australia.

“The company has a mission - to build the bridge between traditional financial systems and regulation and the digital asset space.”